The Sunday detonation forced investors to again question the wisdom of holding on to equities near their highs for the year while reflecting on allocations to havens such as gold
The Sunday detonation forced investors to again question the wisdom of holding on to equities near their highs for the year while reflecting on allocations to havens such as gold

North Korea Nuclear Test Affects Asia, Europe Markets

North Korea Nuclear Test Affects Asia, Europe Markets

Asian and European stocks tumbled along with the South Korean won Monday while the safe-haven yen rallied on news that North Korea had tested what it claimed was a hydrogen bomb, ramping up international tensions.
Less than a week after it rattled global markets by firing a rocket over Japan, Pyongyang on Sunday conducted its sixth nuclear test—sparking further condemnation and a warning from US Defense Secretary Jim Mattis of a "massive military response" if the US or its allies were attacked, AFP reported.
The Sunday detonation forced investors to again question the wisdom of holding on to equities near their highs for the year while reflecting on allocations to havens such as gold.
Seoul said later Monday there were signs the North is preparing another missile launch, adding it could involve an intercontinental ballistic missile similar to the one fired over Japan.
The latest flare-up sent investors fleeing for safe assets, with the yen climbing to 109.50 to the dollar and gold up 0.9%, pushing towards $1,340 and levels not seen since November. The won sank 0.9% against the dollar.
On equity markets Seoul shed 1.2% and Japan's Nikkei ended 0.9% down as the stronger yen hurt exporters. The Kospi 200 Volatility Index, a measure of price swings for some of the largest stocks in South Korea, jumped 11% to 14.78 for the biggest gain since Aug. 11.
Hong Kong stocks finished deep in the red on Monday, in line with a sell-off across Asia. The Hang Seng Index slipped 0.76%, or 212.90 points, to close at 27,740.26.
However the benchmark Shanghai Composite Index rose 0.37%, or 12.46 points, to 3,379.58 and the Shenzhen Composite Index, which tracks stocks on China's second exchange, gained 0.60%, or 11.77 points, to 1,968.12. Singapore gave up 1%.

In Europe
In early European trade London fell 0.5%, Paris shed 0.7% and Frankfurt was off 0.7%.
European stocks fell in early Monday trading but losses were limited and markets appeared to stabilize amid the ongoing crisis in North Korea after President Donald Trump vowed trade action against North Korea, The Street reported.
The Stoxx Europe 600 index, the broadest measure of regional share prices, was marked 0.56% lower in the opening hour of trading, with financial sector stocks among the most notable decliners. Germany's DAX index and France's CAC-40 were both down about 0.5%.
Britain's FTSE 100 was seen 0.32% lower, with the benchmark getting support from a jump in gold prices, which rose more than $13 an ounce to around $1,337 in early European trading. Gold mining companies Fresnillo plc and Randgold Resources Ltd. were marked 1.7% and 2% higher respectively.
The euro gained around 0.2% against the dollar from Friday's close to trade at 1.189 while the US dollar index, which measures the greenback's strength against a basket of six global currencies, slipped 0.2% to 92.65.
The currency moves are likely to weigh on European stocks throughout the session as investors wait for a UN Security Council meeting later Monday and assess the potential for a military response from the United States.
Financial stocks were broadly lower, as French lenders Societe Generale and BNP Paribas dropped 0.80% and 0.84%, while Germany’s Commerzbank and Deutsche Bank tumbled 0.95% and 1.03%.
Among peripheral lenders, Italy’s Intesa Sanpaolo and Unicredit slid 0.30% and 0.81% respectively, while Spanish bank Banco Santander lost 1%.
Elsewhere, Heidelbergcement AG O.N. shares surged 2.71% after analysts at Citigroup upgraded their rating on the stock from “neutral” to “buy”.
In London, commodity-heavy slipped 0.12%, weighed by Micro Focus International, whose shares plummeted 1.06% after the software vendor announced this weekend that the $8.8 billion spin-off and merger of Hewlett Packard Enterprise’s software business has now been completed, newsline reported.
Reckitt Benckiser Group PLC added to losses, with shares down 1.02% after four of the household consumer group’s top 10 executives announced their resignation as the company continues to battle the lowest sales growth in its history.
Financial stocks were also broadly lower, as HSBC Holdings slipped 0.28% and Lloyds Banking fell 0.34%, while the Royal Bank of Scotland declined 0.40% and Barclays dropped 0.73%.
Meanwhile, mining stocks were higher on the commodity-heavy index. Shares in Glencore gained 0.46% and Antofagasta advanced 0.47%, while Randgold Resources and Fresnillo surged 2.53% and 2.91% respectively.


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